UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D)

OF THE SECURITIES EXCHANGE ACT OF 1934

DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): JANUARY 12, 2016

Commission File Number: 0-24260

 

 

 

 

LOGO

AMEDISYS, INC.

(Exact Name of Registrant as specified in its Charter)

 

 

 

Delaware   11-3131700

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

5959 S. Sherwood Forest Blvd., Baton Rouge, LA 70816

(Address of principal executive offices, including zip code)

(225) 292-2031 or (800) 467-2662

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


SECTION 7 – REGULATION FD

 

ITEM 7.01. REGULATION FD DISCLOSURE

As of January 12, 2016 representatives of Amedisys, Inc. (the “Company”) will begin making presentations at investor conferences using slides containing the information attached to this Current Report on Form 8-K as Exhibit 99.1. The Company expects to use these slides, in whole or in part, and possibly with modifications, in connection with presentations to investors, analysts and others during 2016.

By filing this report on Form 8-K and furnishing this information, the Company makes no admission as to the materiality of any information in this report that is required to be disclosed solely by reason of Regulation FD.

The information contained in the slides is summary information that is intended to be considered in the context of the Company’s Securities and Exchange Commission (“SEC”) filings and other public announcements that it may make, by press release or otherwise, from time to time. The Company undertakes no duty or obligation to publicly update or revise the information contained in this report, although it may do so from time to time as its management believes is warranted. Any such updating may be made through the filing of other reports or documents with the SEC, through press releases or through other public disclosure.

In accordance with General Instruction B.2 of this Current Report on Form 8-K, the information presented herein shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as previously set forth by specific reference in such a filing.

Use of our Website to Distribute Material Company Information

Our company website address is www.amedisys.com. We use our website as a channel of distribution for important company information. Important information, including press releases, analyst presentations and financial information regarding our company, is routinely posted on and accessible on the Investor Relations subpage of our website, which is accessible by clicking on the tab labeled “Investors” on our website home page. We also use our website to expedite public access to time-critical information regarding our company in advance of or in lieu of distributing a press release or a filing with the SEC disclosing the same information. Therefore, investors should look to the Investor Relations subpage of our website for important and time-critical information. Visitors to our website can also register to receive automatic e-mail and other notifications alerting them when new information is made available on the Investor Relations subpage of our website.

Certain Forward-Looking Statements

When included in this press release, words like “believes,” “belief,” “expects,” “plans,” “anticipates,” “intends,” “projects,” “estimates,” “may,” “might,” “would,” “should” and similar expressions are intended to identify forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve a variety of risks and uncertainties that could cause actual results to differ materially from those described therein. These risks and uncertainties include, but are not limited to the following: changes in Medicare and other medical payment levels, our ability to open care centers, acquire additional care centers and integrate and operate these care centers effectively, changes in or our failure to comply with existing Federal and State laws or regulations or the inability to comply with new government regulations on a timely basis, competition in the home health industry, changes in the case mix of patients and payment methodologies, changes in estimates and judgments associated with critical accounting policies, our ability to maintain or establish new patient referral sources, our ability to attract and retain qualified personnel, changes in payments and covered services due to the economic downturn and deficit spending by Federal and State governments, future cost containment initiatives undertaken by third-party payors, our access to financing due to the volatility and disruption of the capital and credit markets, our ability to meet debt service requirements and comply with covenants in debt agreements, business disruptions due to natural disasters or acts of terrorism, our ability to integrate and manage our information systems, our ability to comply with requirements stipulated in our corporate integrity agreement and changes in law or developments with respect to any litigation relating to the Company, including various other matters, many of which are beyond our control.

Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on any forward-looking statement as a prediction of future events. We expressly disclaim any obligation or undertaking and we do not intend to release publicly any updates or changes in our expectations concerning the forward-looking statements or any changes in events, conditions or circumstances upon which any forward-looking statement may be based, except as required by law.

 

2


SECTION 9 – FINANCIAL STATEMENTS AND EXHIBITS

 

ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS

(d) Exhibits.

 

99.1   Investor Relations Slide Show in use beginning January 12, 2016 (furnished only)

 

3


Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

AMEDISYS, INC.
(Registrant)
By:  

/s/ Scott G. Ginn

  Scott G. Ginn
  Senior Vice President of Accounting and Controller (Principal Accounting Officer)

DATE: January 12, 2016

 

4


Exhibit Index

 

Exhibit
No.

  

Description

99.1    Investor Relations Slide Show in use beginning January 12, 2016 (furnished only)

 

5



Right care.
Right care.
Right time.
Right time.
Right place.
Right place.
Amedisys Investor Presentation
JP Morgan Healthcare Conference
Exhibit 99.1


1
Forward-looking Statements
This presentation may include forward-looking statements as defined by the Private
Securities Litigation Reform Act of 1995. These forward-looking statements are based
upon current expectations and assumptions about our business that are subject to a
variety of risks and uncertainties that could cause actual results to differ materially from
those described in this presentation. You should not rely on forward-looking statements as
a prediction of future events.
Additional information regarding factors that could cause actual results to differ materially
from those discussed in any forward-looking statements are described in reports and
registration statements we file with the SEC, including our Annual Report on Form 10-K
and subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K,
copies of which are available on the Amedisys internet website http://www.amedisys.com
or by contacting the Amedisys Investor Relations department at (225) 292-2031.
We disclaim any obligation to update any forward-looking statements or any changes in
events, conditions or circumstances upon which any forward-looking statement may be
based except as required by law.
www.amedisys.com
NASDAQ: AMED
We encourage everyone to visit the
Investors Section of our website at
www.amedisys.com, where we have
posted additional important
information such as press releases,
profiles concerning our business and
clinical operations and control
processes, and SEC filings.
We intend to use our website to
expedite public access to time-critical
information regarding the Company in
advance of or in lieu of distributing a
press release or a filing with the SEC
disclosing the same information.


2
Amedisys Strategy
Focusing on our four strategic areas will position us to grow through the headwinds we face
Outstanding Outcomes
for Our Patients In Their
Homes
Amedisys Care Centers    
& Clinical Teams
Current State:
Investing in Quality
29% of centers at 4.0+
STARs
Current State:
Q3’15 same store Medicare
admissions growth of 4%
Q3’ 15 same store hospice
admissions growth 26%
Closed Infinity acquisition
Future:
All care centers at 4.0+
STARs at end of 2017
VBP opportunity
Current State:
Outsourcing of recruiting and
onboarding
Implement engagement plans
Future:
Lower voluntary turnover
Improved employee
engagement and retention
Current State:
126 centers currently on
HomeCare
HomeBase
Rationalizing IT infrastructure
Future:
Realize $40M -
$50M in
savings from IT and HCHB
efficiencies
Future:
Continued HH Medicare
and Hospice Growth
Continued strong cash
generation
Inorganic Growth


2016 and 2017 Headwinds & Tailwinds
Q2’16
Q4’16
Q2’17
Q4’17
Total Impact of Rate
Cut: $28M
2015
$40M -
$50M
Savings (HCHB
and IT
Efficiencies)
$40M -
$50M
Savings
$20M -
$25M
HCHB Efficiencies
$20M -
$25M IT
Efficiencies
Role Consolidation
Regionalize Roles
Optimize Clinician Mix
Increase Productivity
Lower Bad Debt
Coding Accuracy
Supplies Savings
Breakdown of Savings Opportunity
Impact of Rate Cuts and Savings Opportunity
Role Consolidation
Technology Savings


4
Roadmap to Annualized EBITDA Run Rate Improvement
We are projecting $40M -
$50M in annualized savings by Q4 2017.  These savings will be
achieved through our IT restructure and HCHB Efficiencies 
2016 Initiatives
$(5.0)
$25.0
$55.0
Q1 2016
Q2 2016
Q3 2016
Q4 2016
Q1 2017
Q2 2017
Q3 2017
Q4 2017
HCHB
IT
$40M -
$50M


5
Where we will focus our efforts in 2016 and 2017
2016-17 Initiatives
HomeCare
HomeBase
(HCHB)
implementation
Continuing to
invest in quality
Drive organic and
inorganic growth
126 of 411 care centers currently on HCHB
Targeting all care centers live on system by November 1
Anticipate productivity disruption in Q1 and Q2 (~200 care centers
go live)
Initial STARs performance significantly better than the industry
Individualized improvement plans yielding results in only 6 months
Strong Medicare same store growth in home health and hospice
Tailoring business development efforts
Focused on business mix in home health
Infinity Homecare acquisition closed; pipeline remains strong


6
HCHB Implementation Timeline
We have accelerated our HCHB implementation timeline with a target Go-Live date of
November 1, 2016, seven months ahead of our original plan
Why Accelerate?
AMS2 specifications not designed for ongoing operation; rate of regulatory change
increases risk of operating on older system
Desire to move to cheaper POC devices sooner
Impact on employee satisfaction and retention
Acceleration of operational efficiencies and impact on business
All Hospice
Centers on
HCHB
126 Centers
Live as of
January 11
*
*Includes 15 Infinity Care Centers
84
115
99
82
31
411
0
50
100
150
200
250
300
350
400
450
2015
Q1 2016
Q2 2016
Q3 2016
Q4 2016
Total by Jan 1


7
Path to Productivity: Care Center Conversion
Initial implementation data shows that once a center is live on HCHB, they start to see an
uptick in performance after 120 days
Center Performance
Productivity loss
due to system
learning curve
Additional loss
from operating on
two systems
during transition
Minor productivity
loss from splitting
focus
between
operations and
rollout preparation
Clinical: AMS2
cases discharged
or recertified; all
work on HCHB
Back Office: Some
AR/Billing still on
AMS2
All operations on
one system
Staff experienced
with HCHB
Opportunity to
measure
improvements
Sufficient data
available to track
performance
Regions and
centers start to
drive operational
efficiencies
Cases enroll
and
“recertify” in
HCHB
All clinical
operations on
HCHB
All back office
operations on
HCHB
Data available
to drive
performance
Centers supporting
2 systems
System support
HCHB only
Reports become
meaningful
Projected
Long Term
Efficiencies


8
Initial vs. Accelerated Implementation
Change in implementation timeline will result in deeper and more compact operational
disruption, the end result is the same
Center Performance
Q116
115 conversions
Infinity integration
begins
Hospice rollout
completed
Q216
99 conversions
Deepest productivity
impact
YE 2015
84 care centers live
on HCHB
Collecting initial data
on conversions
Positive operational
response from first
sites
Q316
82 conversions
Operational recovery
becomes evident
Q416
31 conversions
Rationalization of IT
infrastructure
Standardization and
process improvement
work begins
May 2017
Projected
Long Term
Efficiencies
Original  Plan
New  Plan


9
What our People are Saying About HCHB
“I love the detail
and specificity of
the reporting on
HCHB”
“HCHB is
preparing our
people to a new
level of
accountability”
I am spending
less time
documenting
because system
is easy to use ”
“We now have the
possibility to see
a complete
patient history on
HCHB”
“HCHB is
empowering our
clinicians to
become true case
managers”


10
Investing in Quality (STARs and VBP)
Annualized 2015 Revenue
in the pilot states
2018 Revenue
using
forecast growth in the pilot
states
+ / -
3% in 2018
for
excellent quality results
$230M
$277M
$8M
Year
+
/ -
Quality
%
$’s at risk or reward
(based
on 2018 revenue)
2019
5%
$14M
2020
6%
$17M
2021
7%
$19M
2022
8%
$22M
VBP States:
Average STARs Scores
Across all Rated Entities:
3.48
The average for the April
preview represents the
highest average Amedisys
entities have seen to date
Entities at 4+ STARs:
29%
All entities will be at 4+
STARs by YE 2017


11
Driving Growth –
Organic and Inorganic
2%
1%
3%
0%
4%
0%
1%
2%
3%
4%
5%
Q314
Q414
Q115
Q215
Q315
HH Same Store Medicare Admissions
-3%
2%
7%
11%
26%
-5%
0%
5%
10%
15%
20%
25%
30%
Q314
Q414
Q115
Q215
Q315
Hospice Same Store Admissions
Infinity Homecare Acquisition
Expanding our Ability to Care for Patients in Florida
Infinity Home Care adds 15 locations in 8
of 11 Florida districts including 48 counties
Balance Sheet and Cash Flow Metrics
Cash
$57
Total
Debt Outstanding
$100
Net Debt
(1)
$43
Leverage Ratio (net)
(2)
0.4x
LTM Adjusted
Free Cash Flow
(3)
$98


12
Investment Rationale
STRONG
CASH
FLOW
AND
BALANCE
SHEET
EXPERIENCED
MANAGED
TEAM
FRAGMENTED
MARKET
RIPE
FOR
CONSOLIDATION
LOWEST
COST
POST
-
ACUTE
SETTING
PATIENT
PREFERENCE
AMEDISYS


Appendix


14
Summary Adjusted Financials
(4)
$ in Millions, except EPS
2014
2015
Variance
2014
2015
Variance
Home Health
237.2
253.4
16.2
717.4
742.6
25.2
Hospice
63.1
73.0
9.9
186.6
199.6
13.0
Total Revenue
$300.3
$326.4
$26.1
$904.0
$942.2
$38.2
Gross Margin %
43.4%
42.8%
(0.6%)
42.6%
43.4%
0.8%
Adjusted EBITDA
23.8
26.4
2.6
51.4
84.4
33.0
7.9%
8.1%
0.2%
5.7%
9.0%
3.3%
Adjusted EPS
$0.28
$0.34
$0.06
$0.46
$1.09
$0.63
Free cash flow
(3)
21.5
29.4
7.9
(89.0)
63.7
152.7
Outstanding debt
149.3
100.0
(49.3)
Cash balance
5.5
57.0
51.5
Available liquidity
(5)
96.2
236.0
139.8
YTD
Q3


15
Home
Health
Segment
Adjusted
Financials
and
Operating
Statistics
(4)
$ in Millions
Q314
Q315
Variance
Medicare
185.4
190.2
4.8
Non-Medicare
51.8
63.2
11.4
Home Health Revenue
$237.2
$253.4
$16.2
Gross Margin %
42.1%
40.8%
(1.3%)
Segment EBITDA
32.6
34.6
2.0
Medicare admit growth - same store
2%
4%
Medicare recertification rate
38%
38%
Medicare admits
42,770
44,434
Medicare recertifications
25,407
25,420
Non-Medicare admit growth - same store
26%
21%
Non-Medicare admits
20,585
24,792
Cost per visit
$85.47
$87.54
Quarterly Highlights
Revenue growth of $16.2M, or 7%
Same store admit growth in Medicare (+4%) and Non-Medicare (+21%)
Strong emphasis on business mix (Medicare vs. Non-Medicare)
Cost per visit increased $2.07 to $87.54
Anticipated increases from ICD-10 prep and headcount / contractor use to deal with growth
Some higher than anticipated cost from higher health insurance and workers’ comp


16
Hospice
Segment
Adjusted
Financials
and
Operating
Statistics
(4)
$ in Millions
Q314
Q315
Variance
Medicare
59.0
68.6
9.6
Non-Medicare
4.1
4.4
0.3
Hospice Revenue
$63.1
$73.0
$9.9
Gross Margin %
48.0%
49.6%
1.6%
Segment EBITDA
16.6
19.6
3.0
Admit growth - same store
(3%)
26%
ADC growth - same store
(3%)
17%
Admits
4,002
4,962
ADC
4,608
5,346
Revenue per day
$148.74
$148.47
Cost per day
$77.38
$74.82
Quarterly Highlights
Year-over-year revenue growth of $9.9M, or 16%
Patient census at quarter end of 5,524, an increase of 23% over census at 12/31/14
Second straight quarter of double-digit same store admission growth
Cost per day year-over-year decrease primarily driven by decrease in pharmacy costs


17
Endnotes
1.
Net debt defined as total outstanding debt ($100M) less cash ($57M) as of 9/30/15
2.
Net leverage ratio defined as net debt ($43M) divided by last twelve months adjusted EBITDA ($107M)
3.
Free cash flow defined as cash flow from operations less capital expenditures and required debt repayments.  Adjusted free cash flow on
slide 11 adds back Department of Justice payment in 4Q14 of $35M.
4.
The
financial
results
for
the
three-month
periods
ended
September
30,
2014
and
September
30,
2015
are
adjusted
for
certain
items
and
should be considered a non-GAAP financial measure.  A reconciliation of these non-GAAP financial measures is included in the 8-K
earnings release filed on November 4, 2015.
5.
Available liquidity defined as the sum of cash balance and available revolving line of credit.
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